Dhaka stocks fall on rumours, political tension

November 30, 2010

Dhaka stocks dropped on Monday for the straight second day as investors, unnerved by a rumour of netting facility suspension move by the regulators and tensions in the political arena, sold off their possessions in afternoon trading, market operators said.
The benchmark general index of Dhaka Stock Exchange lost 59.45 points or 0.69 per cent to close at 8,599.41 points on the day. The index shed 62.22 points in the previous day after a three-day surge.
The market began the day on a stronger note, gaining more than 70 points at about 11:30am.
But it gradually lost steam after the news broke the Appellate Division turned down a petition filed by Bangladesh Nationalist Party chairperson Khaleda Many of the investors sold off their possessions fearing that political situation might worsen as the opposition BNP had already called a general strike for Tuesday (today) in protest against the ‘eviction’ of Khaleda Zia from the cantonment house, said an official of a brokerage house.
Besides, rumours that the SEC would suspend netting facilities and that many of the brokerage houses already suspended netting facility also pushed down the market.
Yawer Sayeed, managing director of asset management firm AIMS of Bangladesh, said a rumour that the Securities and Exchange Commission would suspend the netting facility for investors to cool down the overheated market pushed down the stock prices in the last two days.
SEC executive director Farhad Ahmed, however, said the commission had no plan to suspend the facility.
Yawer said new deposits rules for stockbrokers also put a negative impact on the market that had remained bullish for the past ten weeks.
The SEC on Sunday decided that stockbrokers would have to double their deposits with the stock exchanges to any additional trade exposure from December 5.
A DSE stockbroker said some brokerage houses stopped netting facility for investors on the day because of the SEC’s directive.
DSE president Shakil Rizvi, however, said he did not have any information about such move by any brokerage house.
The daily turnover at the DSE was Tk 2,277.13, down by Tk 303.23 crore from the previous day.
Out of total 232 issues traded on the day, 86 advanced, 140 declined and six remained unchanged.
Southeast Bank topped the turnover leaders with 15.72 lakh shares valued at Tk 95.10 crore traded on the day.
The rest of the turnover leaders were Mercantile Bank, Shahjalal Islami Bank, Peoples Leasing and Financial Services, United Commercial Bank, Pubali Bank, AB Bank, Standard Bank, NCC Bank and LankaBangla Finance.